February 11, 2019 / 7:22 AM / 7 days ago

Final investment decision for Mozambique gas block seen by March-April

Fishing boats sit beneath the skyline of Mozambique's capital Maputo, April 15, 2016. REUTERS/Grant Lee Neuenburg/File Photo

NEW DELHI (Reuters) - A final investment decision, commonly called FID, for a massive offshore natural gas block in Mozambique is expected to be ready by March or April, the chairman of Mozambique’s national oil company ENH said in New Delhi on Sunday.

This is the first time any of the seven partners in the block has given a specific timeline regarding an investment plan for the block, located east of Mozambique’s Rovuma basin and called Area 1.

An FID for the block could unlock value in one of the world’s biggest recent gas discoveries, estimated at 75 trillion cubic feet.

FID is essentially a stage in funding based on which banks can agree to extend lines of credit for a particular project.

Indian companies - state-owned explorer Oil and Natural Gas Corp Ltd through its overseas arm ONGC Videsh Ltd, Oil India Ltd and Bharat Petroleum Corp Ltd together hold the highest share in the block with a 30 percent stake.

National oil company of Mozambique Empresa Nacional de Hydrocarbonetos (ENH) holds 15 percent and Anadarko Mozambique Area, a subsidiary of U.S.-based explorer Anadarko Petroleum, holds 26.5 percent and is operator of the block. “One of the Indian companies has already signed a share and purchase agreement for the gas ... The first molecules will come to India by 2024,” ENH chairman Omar Mitha said.

Reporting by Promit Mukherjee; Editing by Dale Hudson

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